SC asks Mallya to disclose assets, prove his bona fide

The lenders' consortium has requested his presence in person to negotiate a new repayment package.

April 6, 2016 14:35 IST

Vijay mallyaReuters file

Update: 11:33 a.m. IST--

The Supreme Court Thursday asked Mallya to deposit a substantial amount of his offered repayment with it to establish ground for a "meaningful settlement," reported the NDTV.

The court said to his counsel, he should also disclose his assets as well as the assets belonging to his wife and children by April 21 in order to prove his bona fide.

The lender banks' consortium earlier in the day had rejected his repayment proposal from Wednesday evening, and submitted to the court the "proposal was rejected after full consideration." The details of his latest repayment offer, made on Wednesday evening, are awaited.

The consortium also requested his presence to negotiate a new repayment package. The court, too, asked Mallya to indicate when he would be present in person.

The next hearing is scheduled for April 26.

Original Story

Lender banks have rejected Vijay Mallya's offer to pay Rs. 4000 crore to settle the loan of approximately Rs. 9,000 crore due to Mallya and Kingfisher Airlines. The banks have formally sent letters of unacceptability, a senior banker told the Financial Express.

Mallya had submitted a detailed repayment plan to the Supreme Court March 30. His counsel submitted the plan to the consortium of banks requesting confidentiality until final negotiations.

In reply, the lender banks have sent letters, couriers to Mallya's counsel and his offices of Kingfisher Airlines. The letters will also be delivered by hand, according to the report.

The senior banker added that the lenders were disinterested with the repayment amount. According to them, they sought a minimum of Rs. 7,500 crore from an outstanding principal of Rs. 5,000 crore and another Rs. 2,500 crore of interest payments.

Apart from the Rs. 4,000 crore repay offer, Mallya has also come forward to repay another Rs. 2,000 crore depending on the outcome of a case filed against Airbus Industries, reported the FE.

Another banker, however, said Mallya's actual offer stands at Rs. 3,456 crore as he considers Rs. 544 crore recovered from the sale of his assets as part of the Rs. 4,000 crore package. This recovered amount, the banker noted, was deducted from the time the lenders consortium approached the debt recovery tribunal in Bengaluru.

A consortium of 17 lender banks alleged that Mallya defaulted on loans to the tune of Rs. 7,000 crore with regard to Kingfisher Airlines alone. His other concerns owe another Rs. 2,000 crore to the banks.

The banks, the income tax department and the enforcement directorate (ED) all have had overlapping claims to Mallya's assets for either recovery purpose or being charged as illegal assets, said the FE.

The Kingfisher House, the headquarters of the now-defunct airline, found no takers in an e-auction conducted recently under India's securitisation law. Both the IT Department and the consortium banks have claimed rights of sale proceeds from the asset. Income tax authorities had approached a city court to order the consortium to settle IT dues of Rs. 350 crore the airline owed to it.

Mallya's Kingfisher Villa in Goa too has caught the attention of the lender banks. However, the possession of the same has been unsuccessful so far with Mallya himself blocking the bankers' attempts in local courts, said the report.